If true, this seems like a real wasted opportunity - even if that is the future we are getting to in several years, why not release a ready product that people would find useful in the meantime (and would help people arrive at that vision)?
edit: here is the excerpt: http://allthingsd.com/20110425/how-google-killed-gdrive-and-...
He went to Bradley Horowitz, the executive in charge of the project, and said, “I don’t think we need GDrive anymore.” Horowitz asked why not. “Files are so 1990,” said Pichai. “I don’t think we need files anymore.”